How to Close the Savings Gap
When it comes to retirement savings plans, African Americans and Hispanics participate less often, contribute less money, and take out more loans and early withdrawals than our white and Asian counterparts. Those are among the most eye-opening findings from a study by my company’s nonprofit affiliate, Ariel Education Initiative, and Hewitt Associates. We recently partnered with several leading minority organizations to release 401(k) Plans in Living Color: A Study of 401(k) Savings Disparities Across Racial and Ethnic Groups. The study examined the saving and investing behaviors of 3 million eligible African American, Asian, Hispanic, and white workers in 57 of the largest U.S. companies across a variety of industries and sectors. The findings reveal that race and ethnicity play a significant role in investing, showing up in 401(k) positioning, contributions, and ultimately individual balances.
